Benchmarks edged up on Wednesday as investors cheered promising data for a potential COVID-19 vaccine and few better-than-expected quarterly earnings reports.
The Dow Jones Industrial Average (DJI) rose 227.44 points, or 0.9%, to close at 26,870.03 and the S&P 500 rose 29.04 points, or 0.9% to close at of 3,226.56. The Nasdaq Composite Index closed at 10,550.49, adding 61.91 points higher, or 0.6%. The fear-gauge CBOE Volatility Index (VIX) decreased nearly 6%, to close at 27.76. Advancing issues outnumbered declining ones for 5.03-to-1 ratio on the NYSE and a 4.35-to-1 ratio on the Nasdaq favored advancers
How Did the Benchmarks Perform?
Of the 11 major sectors of the S&P 500 only the utilities sector finished in the red. The industrials, energy and financials sectors gave a boost to the broader index and closed at least 1.9% higher for the session. Shares of The Boeing Company BA jumped 4.4% boosting the blue-chip Dow on Wednesday and majority of the stocks ended in the positive.
However, the Nasdaq’s gain was capped by decline in big-techs like Amazon.com, Inc. AMZN, Netflix, Inc. NFLX and Microsoft Corporation MSFT that closed 2.4%, 0.3% and 0.2% lower, respectively.
Overall, the S&P 500 posted 29 new 52-week highs and no new lows, while the Nasdaq Composite recorded 67 new highs and two new lows.
Potential COVID-19 Vaccine News Cheer Investors
Investors have been closing watching the progress in coronavirus vaccine development against the rise in new cases. On Wednesday, data published by the New England Journal of Medicine said that Moderna, Inc.’s MRNA coronavirus vaccine has produced a “robust” immune response in all 45 patients between 18 to 55 years of age in its early stage human trial.
The interim analysis showed that a two-dose vaccination schedule of mRNA-1273 were given 28 days apart across three dose levels (25, 100, 250 µg). The participants’ immune responses were boosted, with no serious adverse effects reported through Day 57. Shares of Moderna closed 6.9% higher for the day.
Q2 Earnings Report in Focus
On Wednesday, blowout quarterly report from The Goldman Sachs Group, Inc. GS helped benchmarks rally. Investors closely watched the second-quarter 2020 earnings reports as the quarter witnessed slump in business activities due to the coronavirus-led lockdown.
Goldman Sachs reported second-quarter 2020 earnings of $6.26 per share, surpassing the Zacks Consensus Estimate of $3.97. The banker reported best quarterly earnings in years and stocks closed 1.4% higher for the day. Despite the coronavirus pandemic flaring up market volatility, the bank’s results were mostly aided by higher fixed Income, Currency and Commodities Client Execution (FICC) revenues during the reported quarter. Goldman’s net revenues were up 41% year over year to $13.3 billion and also surpassed the Zacks Consensus Estimate of $10.1 billion in the reported quarter. (Read More)
Goldman Sachs carry a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Another banker outperforming in the reported quarter was U.S. Bancorp USB. The company reported second-quarter 2020 earnings of 41 cents per share, which surpassed the Zacks Consensus Estimate of 34 cents. The bank posted net revenues of $5.84 billion in the second quarter that surpassed the Zacks Consensus Estimate of $5.53 billion. Increase in non-interest income led to the upside, additionally higher loan and deposit balances were a tailwind. Shares of U.S. Bancorp jumped 3.7% on Jul 15. (Read More)
From the medical sector, UnitedHealth Group Incorporated UNH reported second-quarter 2020 earnings of $7.12 per share which surpassed the Zacks Consensus Estimate by 37.45%. The better-than-expected earnings were driven by an unprecedented, temporary deferral of care in the company’s risk-based businesses, as hospital elective payouts were put on hold due to the coronavirus outbreak. However, the company’s revenues missed the Zacks Consensus Estimate by 2.7% coming in at $62.1 billion. Shares of UnitedHealth Group closed 1.4% lower on Wednesday. (Read More)
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Microsoft Corporation (MSFT) : Free Stock Analysis Report
UnitedHealth Group Incorporated (UNH) : Free Stock Analysis Report
U.S. Bancorp (USB) : Free Stock Analysis Report
The Boeing Company (BA) : Free Stock Analysis Report
Amazon.com, Inc. (AMZN) : Free Stock Analysis Report
The Goldman Sachs Group, Inc. (GS) : Free Stock Analysis Report
Moderna, Inc. (MRNA) : Free Stock Analysis Report
Netflix, Inc. (NFLX) : Free Stock Analysis Report
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